Serge Berger is the head trader and investment strategist for The Steady Trader. Sign up for his free weekly newsletter.
Visa (NYSE:V) — The payment processing platform company has traded well so far in 2011. I have discussed Visa stock before, and it is again getting close to setting up for a high probability trade.
On the weekly chart, note the clear uptrend in place since 2009 and narrowing trading range. Stochastics still have room higher. Overall, it looks like the stock is coiled up and ready to spring.
The daily chart looks much like the weekly chart in that the potential upside energy is apparent by looking at the uptrend and resistance area near $91.
So V is presenting us with a bullish setup on a solid daily close above $91. Initial stops could be set near $81, and should the stock start moving up a trailing stop may be used. An initial profit target can be set around the $98 area.
As a cautionary note, the broader equity market charts remain broken and the prevailing trend is lower. So even if a chart breakout in Visa were to occur, the market could take this stock back down. Manage your stops accordingly.
- See Sam Collins’ Daily Market Outlook: 3 Things That Should Have the Bulls Nervous
- See Sam Collins’ Trade of the Day: Gold Miners ETF Should Continue to Shine
